Every industry is taking a very close look at the channels that are driving consumer spend. For example, the travel industry continues to look at both the distribution channels (OTAs vs. native websites) and the touch-point that is being used to create the transaction (mobile vs. desktop vs. physical / call-in). The non-profit industry is no different and is keeping a very close eye on how online (including mobile) is driving donation dollars.
The Blackbaud Institute recently released its 5th Annual Charitable Giving Report to recap fundraising performance in 2016. The report captures overall giving data from 6,845 non-profit organizations, representing $23 billion in fundraising in 2016.
Here are some interesting takeaways on Online and Mobile Giving:
- Online Giving is Huge in the Month of December: Online giving in December increased for the second consecutive year, and represented ~22% of ALL online giving during the year.
- Online Giving as a Percentage of Total Fundraising is Growing Slowly: Online giving in 2016 represented 7.2% of total fundraising, slightly up from the 7.1% in 2015.
- Public & Society Benefit Captures the Highest Percentage of Fundraising from Online Giving: Public & Society Benefit organizations led all sectors by capturing 10.2% of its total fundraising through online giving in 2016. Medical Research was second with 9.5%.
- Very Few Give Large Donations Online: When looking at how many 'large gifts' ($1,000+) came through online channels, the study found that 89% of those gifts were between $1,000 and $4,999, while just 3% were for $10,000 or more. Another interesting finding here was that 10% of all gifts of $1,000+ were for exactly $1,000.
- Mobile Giving Continues Rising: In 2016, 17% of all online gifts were made through a mobile device, up from 14% in 2015 and 9% in 2014.
Medical Research sees a Disproportionate amount of Online Giving in September & October: Medical Research derives a very high 15.2% and 11.1% of its online giving donations in September and October, respectively. No other sector derives double-digit percentages of online giving in any month from January through October except Medical Research.
This was interesting to me, but then it makes a lot of sense. Breast cancer is one of the largest causes in the U.S. and Breast Cancer Month is in October. Given the number of participants in Breast Cancer walks that raise money through online platforms, those campaigns really take off in September and end sometime in mid- to late-October, thus driving disproportionately high online giving in those months.
Other Interesting Takeaways:
- Total giving grew just 1% in 2016. However, given that 2016 was a presidential election year, it would not be surprising if money normally earmarked for non-profits went to a political campaign instead.
- Millennials Looking for a Cause: The average age of the donor in the U.S. was 62.
- Lack of Donor Engagement: U.S. donors made an average of 1.4 charitable gifts during 2016.
So what does this all mean?
The non-profit industry is clearly a laggard when it comes to online transactions. But, is that all that surprising when the average donor is 62 years old? So while it's easy for organizations to continue to rely on the big check every year from the retired person, that is all going to end at some point.
Non-profits should not take their eyes off of engaging with their donors who do not transact online, but at the same time, they must prepare for the huge wave of online and mobile giving that will likely follow the same patterns that have been seen in industries like retail, where the majority of people who still believed that physical stores would always have a place in our lives are now fighting for their corporate lives. As it turns out, physical stores have fallen victim to e-commerce giants who have created a friction-free, multi-channel, exponential storefront experience. I have no doubt that the best non-profits will do the same thing to the physical check that e-commerce platforms did to brick-and-mortar stores.
However, I also think that the "mobile eats everything" thesis may come very late to the non-profit sector. I still think that the non-profit industry, like the travel industry (which lags retail in mobile transactions), will remain heavily reliant on the traditional online experience encompassed by the large desktop interface (website) to browse through. People like to feel emotive engagement when they give money away and mobile is designed for efficiency, not emotion.
"A really good, clean website with rich content that creates a narrative where problems are clearly linked to solutions is still a great place for a non-profit to invest because great stories will never be commodities."